Papa John's Q3 2026: Comps Slide 8.3% as Guidance Gets Cut Again

Papa John's reported adjusted earnings per share of $0.16 for Q3 2026, beating the consensus estimate of $0.15. Revenue of $454.84 million came in just under the $458.70 million analysts had expected, and fell 10.5% from the same quarter a year ago.

The headline pressure came from North America, where comparable sales dropped 8.3%, with company-owned domestic locations down 7.5% and franchised North America locations down 8.5%. A significant driver of the year-over-year revenue decline was refranchising: Papa John's transferred 113 restaurants out of company ownership after Q3 2025, which stripped out roughly $26 million of domestic company-owned restaurant revenue on its own.

Management responded by lowering full-year guidance. Adjusted EBITDA is now targeted at approximately $175 million, down from a prior range of $180 million to $190 million. Global system-wide restaurant sales are now expected to fall about 5% for the year, worse than the previous forecast of down 2% to 4%, and the North America comparable sales outlook was reset to down roughly 8%.

Papa John's is launching a new initiative called Unbox Better, described by CEO Todd Penegor as built around two priorities: strengthening the brand to give customers more compelling reasons to choose Papa John's, and strengthening the franchise system to deliver on those expectations consistently. A key mechanism is pushing franchisees to increase local marketing investment alongside national campaigns, though management acknowledged the plan provides only about a penny of adjusted EPS upside as an offset.

Papa John's posted $0.32 in Q3 2025 against an estimate of $0.41, then managed $0.34 in Q4 2025 and $0.46 in Q2 2026 before this quarter's $0.16 against an estimate of $0.15. Securities class action lawsuits alleging misrepresentation of the company's transformation strategy add a layer of legal uncertainty that investors will need to track heading into 2027.